Key benchmark indices surged in late trade. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, hit record high. The Sensex was provisionally up 372.41 points or 1.67, up about 335 points from the day's low and off close to 20 points from the day's high. The market breadth, indicating the overall health of the market was strong. The BSE Small-Cap index was up nearly 2%. The market sentiment was boosted by data showing that foreign institutional investors (FIIs) remained net buyers of Indian stocks on Monday, 7 April 2014. Gains in Asian and European stocks also boosted sentiment on the domestic bourses.
Aviation stocks rallied. Pharma stocks rose. Among capital goods shares, Crompton Greaves hit 52-week high. Index heavyweight Reliance Industries (RIL) edged higher.
The market edged higher in early trade on firm Asian stocks. Key benchmark indices extended initial gains and hit fresh intraday high in morning trade. The Sensex trimmed gains in mid-morning trade. The Sensex further pared gains in early afternoon trade. Key benchmark indices extended intraday gains in afternoon trade as European stocks edged higher in early trade there. Key benchmark indices extended intraday gains and hit fresh intraday high in mid-afternoon trade. Key benchmark indices surged in late trade. The Sensex and the 50-unit CNX Nifty, both, hit record high
The market sentiment was boosted by data showing that foreign funds remained net buyers of Indian stocks on Monday, 7 April 2014. Foreign institutional investors (FIIs) bought shares worth a net Rs 703.71 crore on Monday, 7 April 2014, as per provisional data from the stock exchanges. The stock markets was closed on Tuesday, 8 April 2014, on account of Ram Navami.
As per provisional figures, the S&P BSE Sensex was up 372.41 points or 1.67% to 22,715.86. The index jumped 396.59 points at the day's high of 22,740.04 in late trade, a lifetime high for the barometer index. The index rose 36.50 points at the day's low of 22,379.95 in early afternoon trade.
The CNX Nifty was up 107.65 points or 1.61% to 6,802.75, as per provisional figures. The index hit a high of 6,808.70 in intraday trade, a lifetime high for the index. The index hit a low of 6,705.10 in intraday trade.
The BSE Mid-Cap index was up 118.86 points or 1.66% at 7,284.22, underperforming the Sensex. The BSE Small-Cap index was up 144.88 points or 1.99% at 7,425.95, outperforming the Sensex.
The total turnover on BSE amounted to Rs 2310 crore, higher than Rs 1515.34 crore on Monday, 7 April 2014.
The market breadth, indicating the overall health of the market, was strong. On BSE, 1,869 shares rose and 877 shares fell. A total of 113 shares were unchanged.
Among the 30 Sensex shares, 25 rose and the rest declined. Axis Bank (up 4.75%), ICICI Bank (up 4.13%) and Tata Motors (up 4.6%), edged higher from the Sensex pack.
Index heavyweight Reliance Industries (RIL) rose 2.17% to Rs 964.50. The sock hit a 52-week high of Rs 964.85 in intraday trade. The stock hit a low of Rs 936.80 in intraday trade.
Crompton Greaves rose 8.88% to Rs 164.85 after hitting 52-week high of Rs 166.50 n intraday trade.
Pharma stocks rose. Sun Pharmaceutical Industries rose 6.68%, with the stock extending Monday's gains. Ranbaxy Laboratories gained 4.49%. The two companies in a joint statement issued on Sunday, 6 April 2014, announced that they have entered into definitive agreements pursuant to which Sun Pharma will acquire 100% of Ranbaxy in an all-stock transaction. As per the share swap ratio, Ranbaxy shareholders will receive 8 shares of Sun Pharma for every 10 equity shares of Ranbaxy. This exchange ratio represents an implied value of Rs 457 for each Ranbaxy share, a premium of 18% to Ranbaxy's 30-day volume-weighted average share price and a premium of 24.3% to Ranbaxy's 60-day volume-weighted average share price, in each case, as of the close of business on 4 April 2014.
The combination of Sun Pharma and Ranbaxy creates the fifth-largest specialty generics company in the world and the largest pharmaceutical company in India. The combined entity will have operations in 65 countries, 47 manufacturing facilities across 5 continents, and a significant platform of specialty and generic products marketed globally, including 629 ANDAs. On a pro forma basis, the combined entity's revenues are estimated at $4.2 billion with EBITDA of $1.2 billion for the twelve month period ended December 31, 2013. The transaction value implies a revenue multiple of 2.2 based on 12 months ended 31 December 2013.
Sun Pharma at the fag end of the trading session today, 9 April 2014, issued clarification in response to various reports on Silverstreet's investment in Ranbaxy. This pertains to purchase of shares of Ranbaxy Laboratories by Silverstreet Developers LLP and it does not violate insider trading rules, Sun Pharma said. Mr. Sudhir Valia is not and was not a partner of Silverstreet Developers LLP when purchase of shares of Ranbaxy Laboratories was affected by LLP. Silverstreet Developers LLP has two partners. Both are 100% subsidiaries of Sun Pharma. Hence, all the benefits flowing from the investment in Ranbaxy shall accrue to Sun Pharma, Sun Pharma said in a statement.
Shares of other pharma stocks rose on hopes of further consolidation in the sector after Sun Pharma announced the acquisition of Ranbaxy. Cipla (up 0.84%), Dr. Reddy's Laboratories (up 0.68%), Aurobindo Pharma (up 1.04%), Wockhardt (up 0.1%), Divi's Laboratories (up 0.91%), and Strides Arcolab (up 2.13%) edged higher.
Lupin gained 1.29%. The company announced during market hours that it has received final approval for its Pioglitazone Tablets USP, 15 mg,30 mg, and 45 mg from the United States Food and Drugs Takeda Pharmaceuticals to market a generic version of Takeda Pharmaceuticals USA, Inc.'s Actos Tablets, 15 mg, 30 mg, and 45 mg. Lupin Pharmaceuticals Inc. (LPI), the company's US subsidiary would commence marketing the product shortly. Lupin's Pioglitazone Tablets USP, 15 mg ,30 mg, and 45 mg are the AB-rated generic equivalents of Takeda's Actos Tablets 15 mg, 30 mg, and 45 mg and indicated as an adjunct to diet and exercise to improve glycemic control in adults with type 2 diabetes mellitus in multiple clinical settings.
Actos Tablets had annual US sales of $236 million (IMS MAT Dec, 2013).
Aviation stocks rallied. SpiceJet (up 6.09%) and Jet Airways India (up 5.83%), surged.
Jaihind Projects rose by maximum permissible 5% upper circuit at Rs 19.05 on BSE, after the company bagged an order worth Rs 114.83 crore. The announcement was made on Tuesday, 8 April 2014. Jaihind Projects on Tuesday, 8 April 2014 said that the company has bagged an EPC (Engineering, Procurement and Construction) order worth Rs 114.83 crore from Indian Oil Corporation for laying of mainline for Paradip-Haldia-Durgapur LPG Pipeline Project (PHDPL)-Group-A.
The Securities and Exchange Board of India (Sebi) on Monday, 7 April 2014, partially reversed curbs on dollar-rupee forward contracts that were imposed last year after the rupee hit record low against the dollar. Sebi had doubled the margin requirement on the domestic dollar-rupee forward trades last year in a bid to arrest the steep decline of the rupee. The stock market regulator on Monday, 7 April 2014, asked stock exchanges and clearing corporations to restore the initial margins and extreme loss margin for dollar-rupee trades to pre 8 July 2013 levels from 15 April 2014.
The Reserve Bank of India (RBI) on Monday, 7 April 2014, said that with a view to further liberalising the existing facilities the RBI has decided to allow all resident individuals, firms and companies, who have actual or anticipated foreign exchange exposures to book foreign exchange forward contracts up to $250,000 on the basis of a simple declaration without any requirement of further documentation, the RBI said in a circular issued to Authorised Dealer Category-I (AD Category-I) banks. This is higher than the existing limit of $100,000. The existing facilities in terms of this circular for Small and Medium Enterprises (SMEs) having direct and/or indirect exposures to foreign exchange risk permitting them to book/cancel/roll over forward contracts without production of underlying documents to manage their exposures effectively subject to conditions specified therein shall remain unchanged, the RBI said.
The Reserve Bank of India (RBI) next undertakes monetary policy review on 3 June 2014. The RBI left its main lending rate viz. the repo rate unchanged at 8% after a monetary policy review on 1 April 2014, as consumer-price inflation eased to a two-year low and as the rupee firmed up against the dollar.
The next major trigger for the stock market is Q4 March 2014 and year ended 31 March 2014 (FY 2014) corporate earnings. Investors and analysts will closely watch the management commentary that would accompany the results to see if there is any revision in their future earnings forecast of the company for the year ending 31 March 2015 (FY 2015) and/or for the year ending 31 March 2016 (FY 2016). Indian companies will start reporting their Q4 and full year results from mid-April 2014. The result season will conclude in end-May 2014.
A major near term trigger for the stock market is the outcome of the upcoming Lok Sabha elections. The 36 days long voting process began on 7 April 2014 and will conclude on 12 May 2014. The results will be declared on 16 May 2014 after which India will get a new government. The term of the current Lok Sabha expires on June 1 and the new House has to be constituted by May 31.
Polling began for the lone parliamentary seat in Nagaland in the second phase of Lok Sabha elections today, 9 April 2014. The poll will decide the fate of Chief Minister Neiphiu Rio, who is the candidate from his Naga Peoples Front party.
European stocks edged higher on Wednesday, 9 April 2014, as US stocks on Tuesday, 8 April 2014, snapped three straight sessions of losses. Key benchmark indices in UK, France and Germany were up 0.44% to 0.76%.
Sweden's central bank kept its main interest rate unchanged after a monetary policy review today, 9 April 2014, in a bet that an economic recovery will put an end to the threat of deflation. The repurchase rate was held at 0.75% for a second meeting, the Riksbank said in a statement. "Economic activity is clearly strengthening, but inflation is expected to remain low for some time. Monetary policy needs to remain expansionary for inflation to rise towards the target," the Riksbank said.
Meanwhile, Sweden's government today, 9 April 2014, raised its outlook for GDP growth to 2.7% this year, after a 1.5% expansion in 2013.
A monthly meeting of the Monetary Policy Committee of the Bank of England's (BoE) for monetary policy review is scheduled tomorrow, 10 April 2014.
Asian stocks outside Japan rose on Wednesday, 9 April 2014, as consumer companies advanced. Key benchmark indices in Hong Kong, Singapore, China, Taiwan and South Korea were up 0.18% to 1.09% Japanese equities fell after the yen rose against the dollar. The Nikkei 225 Average lost 2.1%.
The Bank of Japan (BOJ) refrained from adding to unprecedented monetary stimulus after a monetary policy review on Tuesday, 8 April 2014, as Governor Haruhiko Kuroda said the blow to the economy from last week's sales-tax increase will fade during the summer. The central bank will continue to expand the monetary base at a pace of 60 trillion yen to 70 trillion yen ($682 billion) per year, it said in a statement in Tokyo. At a press briefing, Kuroda said the BOJ would always adjust policy without hesitation as needed, including easing or tightening. The economy has continued to recover moderately, "albeit with some fluctuations due to the consumption tax hike," the BOJ said in its statement. Kuroda said he will adjust record easing that the BOJ began in April last year should prospects for achieving the price target be jeopardized.
Indonesia's central bank kept its key interest rate unchanged after a monetary policy review on Tuesday, 8 April 2014, extending a pause in monetary tightening as inflation slowed. Bank Indonesia Governor Agus Martowardojo and his board maintained the reference rate at 7.5%, the central bank said in Jakarta. It also kept the deposit facility rate unchanged at 5.75%.
Trading in US index futures indicated that the Dow could advance 37 points at the opening bell on Wednesday, 9 April 2014. US stocks snapped three-day losing streak on Tuesday, 8 April 2014, on bargain-hunting as investors picked up stocks that had fallen the most in the slump over the previous three days.
The US Federal Reserve releases minutes of its March 18-19 gathering today, 9 April 2014. The Federal Reserve on 19 March 2014 said after the conclusion of a monetary policy review that it will trim its monthly bond purchases by $10 billion to $55 billion. The Federal Reserve will end its bond-buying program before the end of the year with an interest-rate increase likely to follow in "around six months," Chair Janet Yellen said on 19 March 2014. Quarterly Fed forecasts on 19 March 2014 showed more officials predicting that the benchmark interest rate, now close to zero, will rise to at least 1% by the end of 2015 and 2.25% a year later.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 29-30 April 2014.
Stronger US growth this year and next will help the world economy withstand weaker recoveries in emerging markets including Brazil and Russia, the International Monetary Fund (IMF) said in a report yesterday, 8 April 2014. The IMF predicted global growth of 3.6% this year, compared with a January estimate of 3.7%. Next year, the expansion will accelerate to 3.9%, unchanged from the prior forecast. Developing Asian economies are forecast to grow 6.7% this year, the IMF said.
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